As the number of future population in school age decreases sharply, management environment of higher education has deteriorated rapidly. Due to this trend, paradigm for universities has changed from matters of evaluation (pecking order) to matters of survivor. Consequently, many studies have been conducted actively on financial analysis and growth prediction of universities. However, studies on financial analysis of private universities have focused on analysis of ratio based on individual management analysis indicators. Therefore, there has been almost no previous study that is based on comprehensive management analysis indicators.
In this paper, the study targeted four-year private universities (150 universities). The analysis model of sustainable growth rate for non-profit organization developed by Jegers (2003) was used to predict sustainable growth rate that was the adequate rate of growth for private universities and to find out financial strategies that universities were required to pursue in the long term based on comparison and analysis of universities by region and size.
According to the summary of empirical analysis results of sustainable growth rate among four-year private universities, growth rate was found to be higher for universities located in the non-capital area than in the capital area and for small-scale universities than large-scale universities. The variable that had the decisive influence on growth rate was found to be the asset efficiency ratio that represented growth at activity level. Such results of empirical analysis suggest many implications on matters of survival for universities in the 2020s and beyond when the number of future population in school age will have decreased sharply and many implications on trend in higher education industry. Moreover, in order to play their role as a higher educational institution, it is believed that universities should reduce entrance quota to keep the number of students at the optimal level, lower fixed costs through structural reform, and perform the efficient and strategic resource redistribution at activity level.